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Wednesday, 13 August 14
WHAT DOES PROJECT CARGO REALLY MEAN TO INSURERS?
 KNOWLEDGE TO ELEVATE
Richard Kamppari-Baker, claims manager of FP Marine Risks, explains the challenges of project cargo risk assessment from an insurer’s point of view.
Project cargo is the large, oversized, overweight heavy lift cargo or critical pieces of equipment that may be high value or time sensitive and sometimes both. Project cargo insurance covers against loss or damage in transit for critical components of large civil, production facility, infrastructure, and/or construction projects.
Considerations
In addition, there are considerations to be taken into account for Delay in Start up (DSU) and Advanced Loss of Profits (ALOP) against loss of income and profit arising from late or non-delivery of critical components due to an accidental occurrence in transit.
Failure of a shipment to arrive, or not arrive intact, can turn a USD10 million cargo loss into a claim ten times its value when factoring in the knock-on effects of one piece of equipment not being ready at a particular date, which then causes disastrous consequences to the project as a whole. Whilst failure of any cargo to arrive has an enormous impact on operations, for project cargo this has far reaching ramifications.
For this reason the assured look towards insurers to cover the additional economic cost when something goes wrong.
Evaluating risk
Insurers will only compensate the assured for the loss or put it back in the same position. So how does an underwriter even start to evaluate the risk when the consequences are not easily apparent? Project cargo is specifically dependent on transport logistics and tight timeframes, so missing any goal or target will have serious knock-on effects.
To begin a proper assessment of the exposure, a few crucial factors need to be considered. The time and costs for re-fabrication as well as for reshipping the item need to be calculated, which is not an easy task when the bespoke nature of these items is considered.
During this time, insurers will need to calculate the knock-on effects when other goals or targets cannot be met. This means they need to evaluate the loss of profit and/or other operational costs at each stage affected until the project is completed. This is by no means guesswork and there is a complex system involved in calculating each risk.
Appraising the exposure is only part of the problem to insurers because one must consider how to move such an item. Project cargo will most likely be out-of-gauge or exceed regular weight limits, so the question is how the transport is to be done. Moving pylons across muddy roads in India during monsoon season, or loading reactors onto vessels, need the highest level of expertise. The services of engineers, surveyors, mariners, naval architects, consultants and government officials will be required. Careful consideration is essential in deciding who to employ.
Relevant experience
A major factor is to ensure the right people with the relevant experience are chosen. A team of international experts may need to be flown out at each stage of the transit. A key role is an individual who will be in charge of coordinating all communications amongst the team, ensuring all members are properly informed whilst avoiding any misunderstanding whatsoever.
Once the determined route has been scrutinised, the next stage is to ensure all requirements are met. Inland transits often require special authorization or conditions and vessels might need special clearance from their P&I clubs or insurers.
Insurers are very reliant on the assured and other experts to advise on stowage and on whether an item is capable of withstanding the rigours of transit. Items that protrude or carry extreme weights present a huge problem while stationary, but these complications are magnified tenfold when combined with extreme forces of rolling and pitching while in transit.
Calculations need to be carried out by professionals, securing contractors to ensure correct fastenings, buttresses, and so on, are used. Stability during the voyage is essential, so great care is taken to ensure the centre of gravity is evenly distributed.
All the advice from the experts is only as good as Mother Nature permits. A final weather routing will often need to be agreed before the shipment can commence.
No matter how fastidious insurers, carriers, freight forwarders and shippers are, there is a chance that an accident will happen. Claims will of course arise when route surveys are not properly carried out of when stowage of fittings are not adequate.
There will always be unforeseen events that cannot be predicted. The role of the insurer is not to take a gamble on whether a shipment will arrive in time and good order, but to know the risks and eliminate the uncertainties. For project cargo this is critically important, given the high cargo values and the potentially enormous claims involved.
Source: FP Marine / Hellenic Shipping
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Monday, 07 July 14
SOUTH AFRICA'S RICHARDS BAY COAL TERMINAL SHIPPED 12% LESS COAL IN JUNE COMPARED TO MAY EXPORTS
COALspot.com: South Africa's Richards Bay Coal Terminal (RBCT) the world’s single largest export coal terminal, shipped 4.91 million tons ...
Monday, 07 July 14
INDONESIAN SUB-BIT COAL SWAPS FOR Q3 DELIVERY CRASHES THROUGH $ 54.50
COALspot.com: Indonesian coal swaps for average Q3’ 2014 lost on day, week and on month according to AsiaClear OTC coal swap's reports re ...
Monday, 07 July 14
API 8 CFR SOUTH CHINA COAL SWAPS SHOW A DOWNWARD TREND THIS PAST WEEK
COALspot.com: API 8 CFR South China Coal swap for delivery in Q3 drops US$ 5.47 month on month on Friday, dipping under $68 a ton. The CFR South Ch ...
Sunday, 06 July 14
PANAMAX INDEX BEING THE BIGGEST GAINER THIS WEEK; UP 52.75% W-O-W
COALspot.com: This week there was some positive signs in all the sectors. The Panamax index being the biggest gainer this week after losing for sev ...
Friday, 04 July 14
US: WEEKLY COAL PRODUCTION SLIGHTLY UP W-O-W
COALspot.com – United States the world's second largest coal producer, produced approximately 19.4 million short tons (mmst) of coa ...
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- Carbofer General Trading SA - India
- Romanian Commodities Exchange
- ICICI Bank Limited - India
- Kepco SPC Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Ministry of Mines - Canada
- Bahari Cakrawala Sebuku - Indonesia
- Bangladesh Power Developement Board
- Dalmia Cement Bharat India
- CNBM International Corporation - China
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Anglo American - United Kingdom
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coalindo Energy - Indonesia
- Africa Commodities Group - South Africa
- Jaiprakash Power Ventures ltd
- Madhucon Powers Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Altura Mining Limited, Indonesia
- Tamil Nadu electricity Board
- Cement Manufacturers Association - India
- Interocean Group of Companies - India
- The State Trading Corporation of India Ltd
- Rashtriya Ispat Nigam Limited - India
- Port Waratah Coal Services - Australia
- Mintek Dendrill Indonesia
- Economic Council, Georgia
- Mjunction Services Limited - India
- Chettinad Cement Corporation Ltd - India
- SMG Consultants - Indonesia
- Kideco Jaya Agung - Indonesia
- GMR Energy Limited - India
- LBH Netherlands Bv - Netherlands
- Videocon Industries ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Krishnapatnam Port Company Ltd. - India
- Bulk Trading Sa - Switzerland
- Semirara Mining Corp, Philippines
- Energy Development Corp, Philippines
- San Jose City I Power Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- European Bulk Services B.V. - Netherlands
- Thiess Contractors Indonesia
- Standard Chartered Bank - UAE
- Sarangani Energy Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- Indo Tambangraya Megah - Indonesia
- The University of Queensland
- Bhoruka Overseas - Indonesia
- Heidelberg Cement - Germany
- Aditya Birla Group - India
- Australian Commodity Traders Exchange
- Uttam Galva Steels Limited - India
- Bhushan Steel Limited - India
- IHS Mccloskey Coal Group - USA
- Riau Bara Harum - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Mercator Lines Limited - India
- Globalindo Alam Lestari - Indonesia
- Bukit Baiduri Energy - Indonesia
- Medco Energi Mining Internasional
- Bayan Resources Tbk. - Indonesia
- Therma Luzon, Inc, Philippines
- Essar Steel Hazira Ltd - India
- Orica Australia Pty. Ltd.
- Bharathi Cement Corporation - India
- McConnell Dowell - Australia
- Iligan Light & Power Inc, Philippines
- Parliament of New Zealand
- Samtan Co., Ltd - South Korea
- Pendopo Energi Batubara - Indonesia
- Baramulti Group, Indonesia
- Metalloyd Limited - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- Planning Commission, India
- CIMB Investment Bank - Malaysia
- Siam City Cement - Thailand
- Merrill Lynch Commodities Europe
- Straits Asia Resources Limited - Singapore
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Intertek Mineral Services - Indonesia
- Indian Oil Corporation Limited
- Mercuria Energy - Indonesia
- PTC India Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maharashtra Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- Global Coal Blending Company Limited - Australia
- Kobexindo Tractors - Indoneisa
- Australian Coal Association
- Wood Mackenzie - Singapore
- India Bulls Power Limited - India
- Wilmar Investment Holdings
- Alfred C Toepfer International GmbH - Germany
- Bank of Tokyo Mitsubishi UFJ Ltd
- Edison Trading Spa - Italy
- VISA Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Oldendorff Carriers - Singapore
- Energy Link Ltd, New Zealand
- Larsen & Toubro Limited - India
- South Luzon Thermal Energy Corporation
- Sindya Power Generating Company Private Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Banpu Public Company Limited - Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Timah Investasi Mineral - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Indonesian Coal Mining Association
- Commonwealth Bank - Australia
- New Zealand Coal & Carbon
- Gujarat Sidhee Cement - India
- Georgia Ports Authority, United States
- Barasentosa Lestari - Indonesia
- Sakthi Sugars Limited - India
- Goldman Sachs - Singapore
- London Commodity Brokers - England
- Karaikal Port Pvt Ltd - India
- Marubeni Corporation - India
- Singapore Mercantile Exchange
- White Energy Company Limited
- MS Steel International - UAE
- Makarim & Taira - Indonesia
- SMC Global Power, Philippines
- Thai Mozambique Logistica
- Kartika Selabumi Mining - Indonesia
- Posco Energy - South Korea
- Bhatia International Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Miang Besar Coal Terminal - Indonesia
- Ind-Barath Power Infra Limited - India
- Kaltim Prima Coal - Indonesia
- Orica Mining Services - Indonesia
- Binh Thuan Hamico - Vietnam
- Gujarat Mineral Development Corp Ltd - India
- Latin American Coal - Colombia
- Meenaskhi Energy Private Limited - India
- Salva Resources Pvt Ltd - India
- Antam Resourcindo - Indonesia
- ASAPP Information Group - India
- Power Finance Corporation Ltd., India
- Billiton Holdings Pty Ltd - Australia
- Simpson Spence & Young - Indonesia
- The Treasury - Australian Government
- Attock Cement Pakistan Limited
- Maheswari Brothers Coal Limited - India
- Kapuas Tunggal Persada - Indonesia
- Trasteel International SA, Italy
- Meralco Power Generation, Philippines
- Chamber of Mines of South Africa
- Sojitz Corporation - Japan
- GN Power Mariveles Coal Plant, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Sical Logistics Limited - India
- Indian Energy Exchange, India
- Vedanta Resources Plc - India
- OPG Power Generation Pvt Ltd - India
- Petron Corporation, Philippines
- Renaissance Capital - South Africa
- Kumho Petrochemical, South Korea
- Directorate Of Revenue Intelligence - India
- Global Green Power PLC Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- Star Paper Mills Limited - India
- Indika Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
- Lanco Infratech Ltd - India
- SN Aboitiz Power Inc, Philippines
- Independent Power Producers Association of India
- Holcim Trading Pte Ltd - Singapore
- Parry Sugars Refinery, India
- Xindia Steels Limited - India
- Electricity Generating Authority of Thailand
- TeaM Sual Corporation - Philippines
- Ministry of Finance - Indonesia
- Savvy Resources Ltd - HongKong
- Siam City Cement PLC, Thailand
- Semirara Mining and Power Corporation, Philippines
- Agrawal Coal Company - India
- Aboitiz Power Corporation - Philippines
- Coal and Oil Company - UAE
- Electricity Authority, New Zealand
- Grasim Industreis Ltd - India
- Rio Tinto Coal - Australia
- Karbindo Abesyapradhi - Indoneisa
- Eastern Energy - Thailand
- Minerals Council of Australia
- PowerSource Philippines DevCo
- Deloitte Consulting - India
- PNOC Exploration Corporation - Philippines
- GVK Power & Infra Limited - India
- Formosa Plastics Group - Taiwan
- Jorong Barutama Greston.PT - Indonesia
- Jindal Steel & Power Ltd - India
- GAC Shipping (India) Pvt Ltd
- Manunggal Multi Energi - Indonesia
- Vizag Seaport Private Limited - India
- Central Java Power - Indonesia
- Malabar Cements Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Transport, Egypt
- Price Waterhouse Coopers - Russia
- IEA Clean Coal Centre - UK
- Ambuja Cements Ltd - India
- Tata Chemicals Ltd - India
- Eastern Coal Council - USA
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